Here's Why Shareholders Will Not Be Complaining About Walchandnagar Industries Limited's (NSE:WALCHANNAG) CEO Pay Packet

Key Insights

• Walchandnagar Industries will host its Annual General Meeting on 14th of August
• Total pay for CEO Chirag Doshi includes ₹12.7m salary
• Total compensation is similar to the industry average
• Over the past three years, Walchandnagar Industries' EPS grew by 65% and over the past three years, the total shareholder return was 531%

We have been pretty impressed with the performance at Walchandnagar Industries Limited (NSE:WALCHANNAG) recently and CEO Chirag Doshi deserves a mention for their role in it. Shareholders will have this at the front of their minds in the upcoming AGM on 14th of August. It is likely that the focus will be on company strategy going forward as shareholders hear from the board and cast their votes on resolutions such as executive remuneration and other matters. Here is our take on why we think CEO compensation is not extravagant.

See our latest analysis for Walchandnagar Industries

How Does Total Compensation For Chirag Doshi Compare With Other Companies In The Industry?

At the time of writing, our data shows that Walchandnagar Industries Limited has a market capitalization of ₹22b, and reported total annual CEO compensation of ₹13m for the year to March 2024. We note that's a decrease of 9.1% compared to last year. Notably, the salary of ₹13m is the entirety of the CEO compensation.

On examining similar-sized companies in the Indian Machinery industry with market capitalizations between ₹8.4b and ₹34b, we discovered that the median CEO total compensation of that group was ₹14m. This suggests that Walchandnagar Industries remunerates its CEO largely in line with the industry average. Furthermore, Chirag Doshi directly owns ₹6.8m worth of shares in the company, implying that they are deeply invested in the company's success.

Component	2024	2023	Proportion (2024)
Salary	₹13m	₹14m	100%
Other	-	-	-
Total Compensation	₹13m	₹14m	100%

Speaking on an industry level, nearly 92% of total compensation represents salary, while the remainder of 8% is other remuneration. On a company level, Walchandnagar Industries prefers to reward its CEO through a salary, opting not to pay Chirag Doshi through non-salary benefits. If salary dominates total compensation, it suggests that CEO compensation is leaning less towards the variable component, which is usually linked with performance.

A Look at Walchandnagar Industries Limited's Growth Numbers

Walchandnagar Industries Limited's earnings per share (EPS) grew 65% per year over the last three years. It saw its revenue drop 6.1% over the last year.

Overall this is a positive result for shareholders, showing that the company has improved in recent years. While it would be good to see revenue growth, profits matter more in the end. We don't have analyst forecasts, but you could get a better understanding of its growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Has Walchandnagar Industries Limited Been A Good Investment?

We think that the total shareholder return of 531%, over three years, would leave most Walchandnagar Industries Limited shareholders smiling. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Walchandnagar Industries rewards its CEO solely through a salary, ignoring non-salary benefits completely. Given the company's decent performance, the CEO remuneration policy might not be shareholders' central point of focus in the AGM. Instead, investors might be more interested in discussions that would help manage their longer-term growth expectations such as company business strategies and future growth potential.

CEO compensation can have a massive impact on performance, but it's just one element. That's why we did some digging and identified 2 warning signs for Walchandnagar Industries that investors should think about before committing capital to this stock.

Switching gears from Walchandnagar Industries, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com